Trade the Dow/Dax

Welcome to this thread, which has one purpose - to trade the Dow Jones and the Dax 30. Currently I am personally trading just the Dow during both the European and US trading sessions as the Dax has gone off the boil lately. Spreads on the Dow should be around 2-3 pips during the European session, and 1 pip during the US. If they are more than that, change your broker.

I will post a pre-session analysis before the London open whenever possible, and all followers are welcome to contribute provided posts are constructive and add to the overall quality of the thread. Live calls are encouraged provided they are supported by some rationale where possible, not necessarily at the time of calling the trade, but when time allows. This way we will all get a better insight into how each one of us is seeing the market, as well as the reasons for taking trades and exits.

One thing I would discourage is the excessive posting of charts. We all have our own charts and methodology, and viewing someone else's, especially when it is unclear what one is supposed to be looking at, is seldom helpful in my opinion. Screenshots to emphasize a point are fine, as long as they are clear, well marked, and coherent. which also goes for screenshots showing trade entries.

It is my hope that this thread becomes a place all serious traders can come to at any time for some quality input, to pool knowledge and learn from one another, and in so doing go some way towards making this long and arduous road we are all travelling as productive and painless as possible.

Just taken these screenshots from my other thread as they show where we are with the Dow currently. The Daily I posted last week, and with today's heavy 314 pip drop in the Dow, it looks like that may have been a correct call and that we could be in for some very heavy selling for the remainder of this week.

Check out the diversion on the daily chart, a very powerful warning sign that the price might be about to fall.

I'm looking at my Dow charts, and it looks like we'll get something of a pullback before and if this pushes lower. Today's CP @ 480 is on top of the 5m 200sma/ema, so this could be a level it heads for and turns, if it gets there. The price though is below its H2 200ema, and the last candle was bearish which indicates a further leg down. I do think we are going down, just depends on whether there's an initial pullback, and to where it goes.

I haven't had time to look at the Dax charts yet, so if anyone wants to give their take on that this morning before the London open, feel free.

So a good pullback already on Dax, but it has hit its 30m 100sma, which for me should be a pretty strong R level, so we'll see what London does. It could easily continue north for sure, as there is plenty of room for higher highs on the bigger tfs, so we'll have to see.

Dow did indeed come off the Central Pivot area and has just stopped short of the 76.4% retrace from yesterday's low. This will be the test for whether it will go lower today, although currently the price is straddling the 61.8% which may also hold it where it is now. That said, the last H4 candle is a shooting star, which hints at more downside during the US session.